KIT Digital and Hyro go into administration

Invigor Group is taking legal action against KIT in the US after misrepresenting its finances

ASX-listed IT investment company, Invigor Group (ASX:IVO), will take legal action against US-based video management software provider, KIT Digital, which placed its Australian arm into administration.

PPB Advisory was appointed as the administrator on December 21. KIT’s subsidiaries Idapative and Hyro Digital have also been placed into administration.

Administrators were appointed not long after KIT was delisted from the Nasdaq and dismissed Grant Thornton as its independent auditor.

Hyro Digital was sold to KIT in June last year for $2 million in cash and 1.84 million in shares. After the sale to KIT, Gary Cohen’s Marcel Equity Group injected $1.24 million into Hyro and he became the company’s chairman. In October, Hyro was renamed as Invigor Group.

Cohen opposed Hyro’s sale to KIT and was lobbying investors not to accept the offer.

According to a statement on the ASX, Invigor is launching legal action in the US for $15.2 million for unspecified damages for misrepresentation and breaches of contract with regard to the Share Purchase Agreement (SPA).

“KIT has previously announced its accounts were not accurate at the time it entered into the SPA and that it’s replacing its auditor. KIT has also not completed on the top-up mechanism process contained in the SPA,” the statement said.

According to a report KIT Digital was experiencing financial difficulties and about 90 jobs will go. The amount owed to creditors hasn’t been disclosed at this stage.

FILL IN THE SURVEY - AND YOU COULD BE A WINNER: ARN wants to hear from YOU. Tell us how you run a successful business and you could win an adrenaline-fuelled adventure of your choice. COMPLETE THE ARN SURVEY.

Tags PPBGary CohenHyro Limitedadministration

Comments

Comments are now closed

 

Latest News

06:00PM
Telstra launches communications initiatives for disabled Australians
05:04PM
Australian Information Industry Association backs changes to ESOP
04:48PM
Blackline appoints APAC GM to lead ambitious growth plan
04:06PM
Fletcher lays down NBN strategy to address communications "equity"
More News
17 Sep
NetSuite: The ROI of Cloud Computing for VARs
17 Sep
SAP HR Connect
18 Sep
How the shift to subscription-based licensing is introducing new risks that ever...
18 Sep
National Data Centre Roadshow - Canberra
View all events